Public spending and international development – same arguments, home and away

The fight currently underway in the UK – and other major economies – about cuts in the public sector, or what exit route from the Keynesianism of the recession, will clearly run and run all the way to the General Election (if not beyond). It’s at least as much about how big the state should be, and what role it should play in a market economy, as it is about practical economic responses to the current state of the global recession. Overseas aid often seems protected from the debate because all the main parties are at least formally committed to hitting the UN target of spending 0.7% of GDP on aid. But there is a major debate about how that money should be spent abroad, and yesterday in New York, Gordon Brown spelt out why public sector solutions to health were better than private ones.

The PM was taking part in the launch of several initiatives (donor governments being split over how to raise the cash needed) designed to provide more money for less developed countries’ health systems. But central to the initiatives is a shared commitment about how the money should be spent – abolishing charges for health care. Gordon Brown stressed that the Washington consensus, which demanded that small charges be levied for health care, had been a death sentence for millions:

“During the 1980s, flawed development policies and bad advice led many poor countries to charge fees. These fees – often only a few pence – have become a death sentence for millions. Today I call on every country in the developed world to help poor countries achieve the goal of universal health coverage.”

Several African countries have recently used overseas aid money to scrap charges for mosquito nets, drugs and maternity care, and they’ve seen a dramatic impact on health. Last week, the TUC and Unison joined development NGOs in publishing a report, Your Money or Your Life, advocating scrapping charges for maternity services to reduce the number of maternal and newborn deaths, replete with data on the issue.

But there are still some who maintain that making desperately poor people pay for their health care is cost efficient and, presumably, nakes them value the health care they receive all the more (sic). And the Conservatives still haven’t come entirely clean on what they plan to do about the sums the Department for International Development spends on supporting public health systems – will they use that money to promote private health care systems, as they have hinted?

To put it as bluntly as possible, how many maternal and newborn deaths are ‘the price worth paying’ for such an ideologically-driven approach?

Written by Owen Tudor

I’ve been the Head of the TUC’s European Union and International Relations Department since 2003 and have worked at the TUC since 1984. I’ve been a member of the Health and Safety Commission, the Civil Justice Council, the Social Security Ad…